HONG KONG, CHINA / ACCESSWIRE / March 20, 2022 / SINOPEC Engineering (Group) Co., Ltd. (“SEG” or the “Company”, together with its subsidiaries collectively known as the “Group”) (stock code: 2386) today announces its annual results for the twelve months ended 31 December 2021 (the “Reporting Period”).
In 2021, while confronted with the complicated situation in the post-pandemic era and the risks and challenges brought about by the changes in the energy and chemical industry, the Company adhered to the general principle of “keeping stability as the top priority and striving for progress steadily”, made progress despite difficulties and achieved fruitful results. The production and operation were progressing steadily, the technical strength was further boosted, the management system was continuously enhanced, the governance level was constantly improving, the grand blueprint was rolled out, and the high-quality development reached a new level, which have laid a solid foundation for our vision of “building the world’s leading technology-oriented engineering company”. In 2021, the Company achieved revenue of RMB 57.760 billion and net profit of RMB 2.130 billion in 2021. The newly signed contracts for the whole year wrapped up with a total value of RMB 63.150 billion and the backlog by the end of 2021 amounted to RMB 111.045 billion. Based on an overall consideration of the Company’s profitability, shareholders’ return and the needs of sustainable development in the future, the Board proposed a final dividend of RMB 0.222 per share in 2021, which is the largest dividend payout since going public. In addition, the interim dividend of RMB 0.091 per share, the annual dividend of RMB 0.313 per share and the dividend payout ratio of 65%, ensuring the continuity of dividend payment.
Representative domestic and overseas projects. During the Reporting Period, representative domestic projects that the Group entered into include Hainan Refining & Chemical Integration Project, Wenzhou Liquefied Natural Gas (LNG) Receiving Station Project, the third phase project of Shandong Liquefied Natural Gas (LNG) Receiving Station, desulfurization station project of Leikoupo Group Project in West Sichuan Gas Field, Bohe New Port-Maoming Oil Pipeline Project, North Huajin Fine Chemical Project, CNOOC Daxie Petrochemical Project, Ningbo Zhongjin Petrochemical Transformation and Upgrading Project, Russia Amur AGCC project, MTO unit in Uzbekistan natural gas chemical complex, melamine production line in Malaysia and FMTG proprietary equipment export project in Chile.
Steady construction development of projects. During the Reporting Period, Zhenhai Base Phase I, Gulei Refining and Chemical Integration and Crude Oil Storage Facility Project Cluster, were fully completed and put into operation. Maoming Synthetic Oil and High-end Carbon Project started smoothly, and Hainan Ethylene, Baling Caprolactam, Wenzhou LNG and other projects were progressing rapidly, which provided important support for our clients’ high-quality development and transformation and upgrading of the industry. As at 31 December 2021, the Group’s backlog was RMB 111.045 billion, representing an increase of 5.1% compared to that as at 31 December 2020, and 1.92 times of the total revenue of RMB 57.760 billion in 2021.
Steady progress in research and development of engineering technologies. the Company’s technical strength also became stronger. In the field of oil refining and chemical industry, the Company opened up a new path for “reducing oil and increasing chemical output” with efficient utilization of crude oil. The “technology of direct cracking of crude oil to produce ethylene” achieved the first industrial application in China, and “packaged technology of million-ton-scale ethylene production from complex raw materials” won the first prize of National Scientific and Technological Progress. In terms of digital construction, we made a breakthrough in applying engineering digital twinning to smart factories, and nearly 30 projects were delivered digitally. A total of 92 achievements of the year won the scientific and technological progress awards at or above the provincial and ministerial levels, fully demonstrating how science and technology has led and supported our business growth.
Chairman of SEG, Ms. Sun Lili said: “Looking back on 2021, the Company adhered to keeping stability as the top priority and striving for progress steadily and achieved fruitful results. We leveraged the combat mode of “Big Corps”, giving full play to our integrated strength of technology research and development, engineering design, equipment manufacturing, construction and installation, and implemented 1,423 projects throughout the year, with an average daily employment of nearly 100,000 people, and the project construction was promoted efficiently in coordination. In the field of new energy and new materials, the technology development of the whole hydrogen energy industry chain was accelerated, and the integrated R&D layout of hydrogen energy production, storage, transportation and terminal utilization was initially formed. The three hydrogen refueling stations contracted for Beijing Winter Olympics were put into use smoothly, and the world’s largest green hydrogen project, Xinjiang Kuqa Photovoltaic Hydrogen Production Project entered the implementation stage. In the field of new materials, many projects such as polyolefin elastomer, low-cost large tow carbon fiber and special rubber were progressing smoothly. Looking ahead into 2022, the Company’s development will enter a new important period with multiple opportunities and in face of more complicated environment and challenges. The Board has approved the Company’s “14th Five-Year Plan”, and is marching forward towards the development goal of “the world’s leading technology-oriented engineering company”. We will deepen the implementation of the six development strategies of “Value-Oriented, Innovation-Driven, Green & Clean, Talent-Based, Globalization-Targeted, Fusion & Symbiosis”, take “Engineering Innovation” and “Value Creation” as the development engines, and bravely ride the waves in meeting the major challenges of energy security, industrial transformation, independent innovation and green transformation, so as to achieve new development, and unfold new accomplishments and create new achievements during the 14th Five-Year Plan. I believe that with the unremitting efforts of the Board, the management team and all our employees, as well as the strong support from our shareholders and all sectors of society, SINOPEC SEG will achieve higher quality and more effective development, make greater contributions to ensuring national energy security, add more momentum to the high-quality development of the petrochemical industry, offer more excellent projects to our clients and create greater value for shareholders, society and employees!”
Business Review and Highlights
Forge ahead in market development
The value of new contracts entered into by the Group during the Reporting Period was RMB 63.150 billion, representing an increase of 0.2% on a year-on-year basis. Among which, the revenue generated in the PRC was RMB 53.120 billion, representing an increase of 11.5% on a year-on-year basis; as for overseas projects, efforts have been made to overcome the impact of the continued spread of the COVID-19 pandemic and the difficulty in mobilizing human resources. The revenue generated from overseas was RMB 4.639 billion, which remained broadly stable on a year-on-year basis.
During the Reporting Period, the Group continued to strengthen its foothold in domestic market. The Group entered into new contracts for a number of large projects, include the EPC contract of Hainan Refining & Chemical Integration Project with a total contract value of approximately RMB9.506 billion; EPC contract of Wenzhou Liquefied Natural Gas (LNG) Receiving Station Project with a total contract value of approximately RMB3.364 billion; EPC contract for the third phase project of Shandong Liquefied Natural Gas (LNG) Receiving Station with a total contract value of approximately RMB981 million; EPC contract for desulfurization station project of Leikoupo Group Project in West Sichuan Gas Field with a total contract value of approximately RMB2.315 billion; EPC contract of Bohe New Port-Maoming Oil Pipeline Project with a total contract value of approximately RMB2.040 billion; engineering design contract of North Huajin Fine Chemical Project with a total contract value of approximately RMB626 million; engineering design contract of CNOOC Daxie Petrochemical Project with a total contract value of approximately RMB303 million; engineering design contract of Ningbo Zhongjin Petrochemical Transformation and Upgrading Project with a total contract value of approximately RMB154 million.
During the Reporting Period, the Group signed the ethylene plant construction project for Russia Amur AGCC project with a total contract value of approximately USD942 million; signed the process package design contract of MTO unit in Uzbekistan natural gas chemical complex, which debuts Sinopec SMTO technology in international arena; signed the preliminary design contract of melamine production line in Malaysia and the EPC contract of FMTG proprietary equipment export project in Chile.
Successful Implementation of Major Projects
- Committed to becoming the world’s top five refining and chemical production base: Zhenhai Refining and Chemical Ethylene Expansion Project has been delivered and started smoothly.
- Key projects of the national petrochemical industry plan: Hainan Refining and Chemical Integration Project has entered the stage of rapid construction with an overall progress of over 70%.
- The largest petrochemical industry corporation project cross – Strait: Fujian Gulei Refining and Chemical Integration Project has been delivered and started smoothly.
- Sinopec – Saudi Basic Industry Corporation Strategic Cooperation Project: SINOPEC SABIC Polycarbonate Project has been handed over, and the main installations have started operation smoothly.
- Zhejiang Provincial Key Project: Wenzhou LNG Project has entered the peak period of construction, with an overall progress exceeding 40%.
- Natural gas supply strategy project for the Beijing-Tianjin-Hebei-Shandong region: Tianjin LNG Project (Phase II) has entered the stage of rapid construction with an overall progress of over 60%.
- Key project of new and old energy conversion in Shandong Province: Shandong LNG Project (Phase II) has been delivered and started smoothly.
- Zhoushan green petrochemical base: Zhejiang Petrochemical Zhoushan Refining and Chemical Integration Project (Phase II) is in the final stage of construction, with an overall progress exceeding 90%, and some installations have been started operation.
- Belt and Road strategic project: Russian Amur AGCC Polyolefin Project is in the design and procurement stage, with an overall progress exceeding 60%.
- Belt and Road strategic project: Russia Amur AGCC Ethylene Plant Project is in the stage of civil engineering and underground pipe construction, and in all the progress is in the initial stage of the project.
Strong support for engineering service
During the Reporting Period, by overcoming the adverse impact of the pandemic, we actively carried out the normalized action of “tackling key problems and creating efficiency”, strengthened the overall planning of project resources, and made every effort to ensure the smooth operation of the project; strengthened the coordination of the construction of key projects, reviewed the implementation plan of major projects, and ensured that measures were made and implemented for the risk prevention and control for each project; focusing on profitability and progress, the Group implemented the “triple warning” for progress deviation, revenue deviation and budget deviation, rectified the deviation in a timely manner, and strengthened closed-loop management; through optimising the design workflow and professional division interface, the Group strengthened standardization, integration, modular design and modular construction to improve the efficiency of design and construction.
During the Reporting Period, the Group continued to strengthen the construction of subcontracting management system, and dynamically evaluated the operational effectiveness of the QHSE (quality, health, safety and environment) system of strategic subcontractors; continued to strengthen the cultivation of strategic subcontractors, and ensured the quality, safety, progress and cost control of project construction; realized the integrated management of subcontractor resource pool and subcontractor evaluation, optimized the allocation of subcontracting resources and reduced the cost of subcontracting management. The Group has actively explored ways and means to improve procurement management, procurement efficiency, cost reduction and efficiency promotion, continued to promote the practice of framework agreement procurement and centralized procurement, and carried out strategic cooperation with overseas project suppliers.
System construction has improved management efficiency in an all-round way
During the Reporting Period, focusing on the construction of management system, the Company strengthened process management and risk prevention and control, benchmarked with international standards, established a management system based on risk thinking, process standards, strengthened process control integrated with institutional systems. We have introduced 24 process modules, formulated 254 business process control processes, formulated and revised 95 management systems, which is of great significance for the Company to improve management ability, define the management interfaces, and clarify work processes and standards. The Company’s management system has passed Lloyd’s audit and certification and obtained ISO9001, ISO45001 and ISO14001 certification.
Quality, safety and environmental protection management are carried out solidly
During the Reporting Period, all cadres and employees of the Company actively responded to adverse factors such as extreme weather, repeated pandemic situation. By means of system audit, special actions, rectification and promotion, we made every effort to promote the construction and operation of QHSE management system, effectively implemented the main responsibility of enterprises, and achieved double victories in epidemic prevention and control and safe production. No accidents were reported in safety, quality and environmental protection throughout the year; in terms of pandemic prevention and control, the record of “zero infection” was always maintained for our projects within the territory of China, the public safety and infection risk of overseas projects were generally controlled. As at the end of the Reporting Period, 295 million continuous safety man-hours were achieved, and a good trend was maintained in respect to safe production. During the Reporting Period, eight member enterprises of the Group won the title of “Green Enterprise”, and in total the Group won 2 national quality engineering gold awards, 2 silver awards and 21 provincial and ministerial quality awards.
The advantages of engineering technology innovation are prominent
Steady advancement in research and development of engineering technologies and major progress in key scientific research projects
During the Reporting Period, the Group signed 214 new technology development contracts and 72 new technology licensing contracts. All of the engineering technology innovations closely focused on the Company’s strategic development and technical requirements of the engineering market. The key scientific research projects were steadily advanced, and important progress was made in tackling key core technologies.
In the field of new energy and hydrogen energy, we accelerated the technology deployment and development of the whole hydrogen energy industry chain, and undertook the research and industrial application demonstration of a number of major hydrogen energy projects of Sinopec, including hydrogen production by electrolyzing water with Proton Exchange Membrane (PEM) and Solid Oxide Electrolysis Cell (SOEC), green hydrogen and blue hydrogen production, energy-saving hydrogen production by conversion of hydrocarbons and alcohols, hydrogen storage in organic liquids, hydrogen compression and transportation, hydrogen liquefaction, research and development of non-metallic hydrogen storage containers and other technical fields, we have initially formed an integrated R&D layout of hydrogen energy production, storage and transportation and terminal utilization, which will provide technical support and guarantee for the Company to comprehensively expand hydrogen energy business; the world largest green hydrogen project that we contract – Xinjiang Kuqa photovoltaic hydrogen production project entered the state of implementation, and the 10,000-ton green hydrogen projects in Erdos and Wulanchabu steadily advanced; the hydrogen purification installation for 3,000Nm3/h fuel cell in Tianjin was completed and put into operation, and three hydrogen refueling stations, such as Xiwanzi in Chongli of Hebei Province, were put into operation successfully, providing hydrogen energy guarantee for Beijing Winter Olympics.
In promoting the development of energy saving and environmental protection technologies for green development, fractal enhanced mass transfer technology of Shijiazhuang diesel liquid-phase hydrotreating unit has been successfully applied, and various technologies and energy saving indexes are superior to the research and development targets. The development and industrial test of wet oxidation technology of sulfur-containing waste alkali liquor for million-ton-scale ethylene production line have been successfully put into production in Zhenhai, and all technical indexes have reached the research and development targets. The industrial test of 100m3/h biological fluidized bed for PTA wastewater treatment was put into operation in Sinopec Shanghai Petrochemical Co., Ltd. and passed the appraisal, which effectively promoted the green development of petrochemical enterprises.
In the field of new materials, the production technology development and industrial application of poly α olefin lubricating oil (PAO) have been successfully put into production, filling the technical gap of low viscosity fully synthesized high quality lubricating oil in China; and Jinling and Maoming high-end carbon materials project have successively put into production and produced qualified needle coke products, opening up a new technical path for the high-value utilization of catalytic slurry; the first domestic 3,000-ton/year high-gauge polybutene-1 industrial demonstration plant, which enjoys the reputation of “plastic gold”, was successfully put into operation in Zhenhai, marking another major technological breakthrough of the company in the field of high-end synthetic new materials; the carbon fiber involved in the development project was successfully used in the shell of the torch “Feiyang” of the 2022 Beijing Winter Olympics, which successfully solved the problems of high temperature resistance and cold feel of the metal shell used for the torch relay in winter.
In the field of traditional oil refining and chemical industry, the industrial application demonstration of deep catalytic cracking technology for residuum to chemicals (RTC) which participated in the development is progressing smoothly in Anqing, and has become one of the first-choice technologies for the transformation and development of many domestic oil refining enterprises. Known as “using wheat to make bread”, the technology of direct cracking of crude oil to produce ethylene was successfully tested in Tianjin petrochemical industry, which opened up a new path for “reducing oil and increasing chemical output” and efficient utilization of crude oil. “Complete technology development of VOC removal process for gas-phase polypropylene products” has been implemented in Maoming and Yangzi, all of which have achieved the technical development goal and provided technical support for improving the quality and efficiency of polypropylene products.
Increasing number of patent applications and numerous fruitful results in technological innovation
During the Reporting Period, the Group completed 681 new patent applications, among which, 476 were invention patents, accounting for 69.9%, and the proportion of invention patents continued to increase. The Group also had 422 newly licensed patents, 171 of which were invention patents.
During the Reporting Period, the Group received a total of 92 scientific advancement awards in scientific innovation and engineering construction fields at the provincial and above level. Among these awards, “Research and development and industrial application of packaged technology for million-ton-scale ethylene production from complex raw materials” won the second prize of National Scientific and Technological Progress Award. We won 6 first prizes, 5 second prizes and 4 third prizes of Sinopec Science and Technology Progress Award; 2 special prizes, 6 first prizes and 4 second prizes of other provincial and ministerial level awards for scientific and technological progress; 2 gold, 1 silver and 1 bronze prizes in the national excellent design appraisal.
The new format of engineering digital twinning application has begun to take shape
During the Reporting Period, the Group promoted the top-level design of refining and chemical engineering business domain as a whole. We have implemented the work plan of “domain leader” responsibility system, set up a group-level leading group, working group and expert team, and worked out the implementation plan for 22 key business lines and 229 key tasks based on the new information construction model of “data + platform + application”. In terms of digital engineering application, we sped up the integration of systems in all aspects of the whole life cycle of engineering construction, and delivered high-quality digital factories for key projects such as Zhongke, Zhenhai and Gulei. The Company has nearly 30 digital delivery projects in process of implementation. In terms of intelligent factory service, we have established the “ABCD” operation service mechanism, and we took the lead in compiling the feasibility study report of Sinopec equipment domain integration construction project, which has been approved by upper authority. The preliminary design of the pilot project of central enterprises’ industrial Internet platform collaborative promotion mechanism which is rolled out under general steering by the Group has been reviewed, and the petrochemical intelligent cloud platform service team selected for evidence collection has been well reputed.
Strategy leads to drive high-quality development
During the Reporting Period, the Group comprehensively summarized the achievements and experience of the 13th Five-Year Plan, and made an in-depth analysis of the development environment, opportunities and challenges faced by the Company, formulated of the 14th Five-Year Plan, defined the development vision of “building a world-leading technology-oriented engineering company”, while taking the vision of “an integrated service provider in the whole industrial chain and the whole life cycle of the energy and chemical industry” as its development orientation, “engineering innovation and value creation” as development engines, and “Value-Oriented, Innovation-Driven, Green & Clean, Talent-Based, Globalization-Targeted, Fusion & Symbiosis” as the development strategy. With these strategies in place, the Company aims to achieve higher quality and more efficient development.
Looking forward to 2022, there is still uncertainty in the repeated global pandemic situation. The international crude oil price has crossed the 100-dollar threshold, the rising commodity prices and the accumulation of inflation risks, the instability, uncertainty and imbalance of world economic development are still outstanding. At the same time, China’s ability for macroeconomic regulation and control is constantly improved, and the fundamentals of long-term improvement remain unchanged.
In 2022, China’s energy industry will accelerate restructuring and move towards a new stage of high-quality development. In the coming period, the energy industry will face a series of transformational challenges: first, the rapid development of new energy industry will profoundly affect the energy industry pattern; second, the green and low-carbon transformation under the goal of “Dual Carbon” will become the fundamental power of the development of traditional energy industry; third, industrial transformation and upgrading pose higher requirements for independent innovation capability of enterprises.
In 2022, the Group will continue to adhere to “Establishing world-leading technology-oriented engineering company” as its development goal, focus on engineering innovation and value creation, strengthen and optimize traditional advantageous businesses, and accelerate integrated innovation and engineering transformation of new energy and new materials projects. In 2022, the Group’s target for new contracts signed in China is RMB 60 billion and target for new overseas contracts is USD 1 billion.
Summary of Financial Data and Indicators Prepared in Accordance with International Financial Reporting Standards (“IFRS”)
|As at 31 December 2021||As at 31 December 2020||Changes from the end of 2020 (%)|
Total equity attributable to equity holders of the Company
Net assets per share attributable to equity holders of the Company (RMB)
|For the twelve months ended 31 December||Unit: RMB’000|
|2021||2020||Changes over the same period of 2020 (%)|
Profit before taxation
Net profit attributable to equity holders of the Company
Basic earnings per share (RMB)
Net cash flow generated from operating activities
Net cash flow generated from operating activities per share (RMB)
|For the twelve months ended 31 December|
Gross profit margin (%)
Net profit margin (%)
Return on assets (%)
Return on equity (%)
Return on invested capital (%)
|As at 31 December 2021||As at 31 December 2020|
Asset-liability ratio (%)
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This press release is issued by PRChina Limited on behalf of SINOPEC Engineering (Group) Co., Ltd.
About SINOPEC Engineering (Group) Co., Ltd.
The Group is a leading energy and chemical engineering company in the PRC with strong international competitiveness and can provide domestic and overseas clients with overall solutions for petrol refining, petrochemicals, aromatics, coal chemicals, inorganic chemicals, pharmaceutical chemicals, clean energy, storage and transportation facilities, environmental protection and energy saving, among other industry sectors. The Group is an integrated service provider for the whole industry chain and the whole life cycle in energy and chemical industry and can provide overall industry chain services including engineering consulting, technology licensing, project management contracting, financing assistance, EPC (engineering, procurement and construction) contracting, as well as design, procurement, construction and installation, lifting and transportation of large equipment, precommissioning and start-up.
After nearly 70 years of continuous development, the Group currently has an academician of the Chinese Academy of Sciences, three academicians of the Chinese Academy of Engineering and more than10,000 professionals. The Group has rich project management and implementation experience, and owns and cooperatively owns patents and know-how in core business areas. The Group has delivered on schedule hundreds of modern factories with enormous investment, complicated process, advanced technology and high quality to clients in more than 20 countries and regions around the world, established long-term and steady cooperative relationships with large energy and chemical enterprises at home and abroad, maintained an extensive and stable client base, and enjoys remarkable industrial influence and social reputation.
In the future, adhering to the development orientation of “Integrated Service Provider with Whole Industry Chain and Whole Life Cycle in Energy and Chemical Industry”, the Group will base itself on the energy and chemical engineering construction industry, continuously broaden its business scope and extend its value chain. The Group take “Engineering Innovation” and “Value Creation” as the development engines and deepen the implementation of the six development strategies of “Value-Oriented, Innovation-Driven, Green & Clean, Talent-Based, Globalization-Targeted, Fusion & Symbiosis”. The Group comprehensively improve the level of safe, efficient, green and lowcarbon service in the business chain, and fuel a new momentum in achieving the corporate vision of “building the world’s leading technology-oriented engineering company”.
This press release includes “forward-looking statements”. All statements, other than statements of historical facts that address activities, events or developments that the Group expects or anticipates will or may occur in the future (including but not limited to projections, targets, other estimates and business plans) are forward-looking statements. The Group’s actual results or developments may differ materially from those indicated by these forward-looking statements as a result of various factors and uncertainties, including but not limited to the price fluctuation, possible changes in actual demand, foreign exchange rate, market shares, competition, environmental risks, possible changes to laws, finance and regulations, conditions of the global economy and financial markets, political risks, possible delay of projects, government approval of projects, cost estimates and other factors beyond the Group’s control. In addition, the Group makes the forward-looking statements referred to herein as of today and undertakes no obligation to update these statements.
Investor and Media Enquiries:
SINOPEC Engineering (Group) Co., Ltd. – Office of the Board
Liu Jingjing /Zheng Zhexia
Tel: (86) 10 5673 0523 / (86) 10 5673 0525
Email: [email protected]
Joanne Liu / Jack Liu / Mei Ning
Tel: (852) 2522 1838 / (852) 2522 1368
Fax: (852) 2521 9955
Email: [email protected]
SOURCE: SINOPEC Engineering (Group) Co., Ltd.
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